Iraq is gearing up for a potential conflict with its semi-autonomous Kurdistan region in a battle over the oil-rich land situated there, Al Jazeera reported on Sunday.

Kurdish soldiers and equipment have been mobilised and sent to the disputed area, 170km north of Baghdad, following a long-running feud regarding oil rights in the region. Baghdad has recently sought to regain control of contracts with big companies based in the country, after the Kurds took over post American invasion.

Iraq's parliament speaker, Osama al-Nujaifi, said on Saturday that "significant progress" had been made to resolve the stand-off. However, the latest troop movements raise the real possibility of armed conflict between the two sides: both parties have previously come close to battle, only pulling back at the last moment.

Commentators claim the build-up of troops indicates the loss of trust between the two sides as they battle over the highly lucrative oil fields, which Baghdad has laid claim to.

Kurdistan has been pushing for autonomy for decades but the current stand-off looks set to bring a breakaway Kurdish region closer to reality.